Post navigation

NEVER BAILED OUT: Europe’s ants and grasshoppers revisited

A new take on Aesop’s tale, tailor-made for our ‘European Moment in History’, at a time when Europe’s collapse is being guaranteed by the dominance of the wrong narrative. What follows is an attempt at an alternative take; one that is more in tune with a decent future for Europe.

Once upon a time a Greek called Aesop told the story of the industrious ant and the profligate grasshopper.

Over the past two years, the Greeks have earned an international reputation as Europe’s grasshoppers, with the Germans in the role of the ants. Alas, the Greeks’ reputation has now spread westwards and even northwards (toward the Emerald Isle) as all sorts of non-Greeks are painted with the same paintbrush.

The now infamous bailout packages for Greece have propagated the view that the eurozone is divided simply between northern ants and southern grasshoppers. That with the warmth of the euro’s summer days behind us, now that the easy money from Wall Street and the City have disappeared, a winter of discontent has descended upon us all due to the grasshoppers’ idleness.

Thus the dominant story in Europe today is that, in the frozen mists of this awful winter, the southern grasshoppers are knocking on the northern ants’ doors, cap in hand, seeking one bailout after the other. The ants, understandably, are coy and will only respond if the grasshoppers promise to change their ways. In short, the stocks that the ants accumulated for the heavy winter are being endangered by hungry, careless grasshoppers who resist changing their profligate ways.

The problem (for those seeking to understand a Crisis) with attractive allegories is that the latter can be as much of a help as a hindrance. In this post I wish to argue that Aesop’s timeless tale, however appropriate it may seem at first glance, contributes more to Europe’s current problems than to their solution. My reason is simple: The ants and the grasshoppers are to be found in both Greece and in Germany, in the Netherlands and in Portugal, in Austria as well as in neighbouring Italy. But when we assume that all the ants are in the north and all the grasshoppers in the south, the remedies we introduce are toxic.

Yes, it is true, the Crisis has placed a disproportionate share of the burden on the back of Europe’s ants. Only Europe’s ants are not exclusively German or Dutch or Austrian; and nor are the grasshoppers exclusively Greek, Iberian or Sicilian. Some ants are German and some are Greek. What unites Europe’s ants, north and south, east and west, is that they struggled to make ends meet during the good times and they are struggling even more now during the bad times. Meanwhile, the grasshoppers, both in the north and in the south of Europe, lived the good life before the Crisis and are doing fairly well now, keen as always to privatise the gains and distribute the pain (to the ants).

So, in my take of the famous tale, if Aesop’s tale is the one we want to use in order to understand the eurozone debacle, we better get our ants and our grasshoppers right!

The Greek Ants: Hard working couples, holding two low productivity jobs (e.g. supermarket checkout assistants) before this Crisis, but who traditionally found it hard to make ends meet due to low wages, exploitative working conditions, a rate of inflation (for their lowly basket of goods and services) much above the official average (especially after the euro’s introduction boosted food and basic goods prices), massive pressure from banks et al to take loans out in order to provide for their kids that which the TV tells them no kid should be without and which their meagre wages cannot afford etc. Come the Crisis, members of their family lost their jobs, the rest lost parts of their earnings, bank loans were called in, taxes rose, they have to contemplate living without electricity (as the State tries to squeeze more tax out of them through the electrivity bill) the family’s prospects collapsed. Moreover, they are being painted as the villains of the (euro, even the global) piece.

The German Ants: Hard working but relatively poor people, in high productivity growth industries (e.g. VW factory workers), struggling to make ends meet both before and after the eurozone crisis. Their increasingly productive labour, and low, stagnant wages, meant that profit rates in Germany skyrocketed and were converted into surpluses whose size grew speedily partly due to a redistribution of income away from the German ants and toward their employers and partly because of the country’s greater net exports (which accelerated the cheaper German labour was becoming). Once created, these surpluses sought higher returns elsewhere, due to the low interest rates these surpluses induced in Germany. It was at that point that the German grasshoppers (the inimitable bankers whose aim was to maxinise gain in the short run out of zero effort ) looked south for a good deal.

After years of higher interest rates and large deficits, the eurozone’s south had managed to decrease the interest rate differential with the north. However, the differential was still there; especially for personal and credit cards loans where it was huge. Thus, German capital (produced by the German ants’ hard, cheap labour and directed by the irresponsible German grasshoppers) flowed south in search of higher returns. What happens when money floods in unexpectedly? Bubbles form. It is that simple. In Spain they took the form of real estate bubbles. In Greece the bubbles manifested themselves in the form of public debt, as the Greek grasshoppers (also known as Greek developers-) found it easier to grab the German capital flows via the accounts of the state, whose administrators were only too keen to shower the Greek grasshoppers with procurement contracts.

The precise form of the southern bubbles does not matter. They would burst asunder anyway, once the massively larger bubbles created by our transatlantic uber-grasshoppers (Wall Street) popped. What does matter is that the German ants could see that their hard work was not translating into a better life but into more drudgery and less purchasing power.

Never bailed out

Come the Crisis, the German ants were then told that they must tighten their belt again, at a time when they are falling deeper into a poverty trap. They were also told that their government is sending zillions to the Greek government. Since they were never told that the Greek government is not allowed to use this money to cushion the blow against the Greek ants (indeed, that the loans were given on condition that the blow against the Greek ants would be maximised so as to minimise the pain of the Greek and German grasshoppers), they were mightily puzzled: Why are we working harder than ever, taking home less than ever? Why is our government sending money to the Greek grasshoppers and not to us?

Meanwhile, the Greek ants were both desperate and indignant. The grasshoppers of both countries pointed the finger at them, calling them all sorts of names. Their puzzlement hit record levels when told that they had, in effect, threatened (through their profligate ways) to bring down civilisation-as-we-know it. They scratched their heads, thinking that there must be a mistake since they never had any good days during the supposedly good times. They had struggled then and they are struggling now, admittedly far more desperately. As for the bailouts, they simply cannot see them, as no one tells them that the mentioned zillions end up in Europe’s bankrupt banks, where they duly fall into bottomless black holes. And when they see Germans calling them thieves, corrupt, spendthrift, over-reachers, it is not hard to reach into collective memory for moments in history that make it ever so easy to become anti-German.

A less Aesopian take

Before the euro was established, a remarkable experiment took place simultaneously in Greece and in Germany.

In Germany, government, employers and the trades unions agreed to try to restore German competitiveness, employment and growth by reducing German wages and, thus, squeezing German inflation below that of the European average.

Meanwhile in Greece, the government of the time struggled to prepare the country for accession to the eurozone by also squeezing real wages, taking advantage too of the influx of migrants into the country.

The German experiment worked a charm and kept working even after the euro was created. Real wages fell and fell. Unemployment was slashed. The gleaming factories produced more and more for less and less. German goods flooded the markets and, at the same time, Germany’s success caused money to become even cheaper, flooding the surrounding eurozone countries, including Greece. Germany’s ants worked harder for less while Germany’s grasshoppers laughed all the way to their bank.

The Greek experiment worked well also, until Greece entered the euro. Once inside, the flood of cheap money from the outside, from Germany as well as from Wall Street, allowed the Greek grasshoppers, and their political allies in government, to borrow from the German ones (the banks) as if there was no tomorrow. Every time the Greek ants asked for some of the benefits of being in the euro, they were either paid off with cheapskate public sector jobs, paid for with borrowed money, or were told to go to the banks and borrow directly. On the back of European structural funds and rivers of borrowed monies, the Greek grasshoppers, in alliance with some German ones, got fatter and fatter while the Greek ants were struggling to make ends meet.

And then Wall Street collapsed for reasons of its own. When the collapse crossed the Atlantic, hitting the banks first and the eurozone’s public finances later, it was the Greek grasshoppers’ state that went belly up first. Someone had to be blamed. Europe’s grasshoppers found it convenient to fall back on the scoundrel’s last refuge: nationalism. Suddenly a war of words between Greeks and Germans, Northerners and Southerners, was staged that hides a terrible truth: No one was ever bailed out except for some of the grasshoppers of both the north and the south.

Moral of the story(All Aesop tales have one!)

Many think of Aesop’s parable as a morality tale whose purpose was simply to warn against sloth, laziness and an unhealthy disregard for the future. Alas, it was more than that. Aesop was sounding the alarm bell against both the grasshopper’s spendthrift ways and the ant’s extreme parsimony.

Today there is another wrinkle that needs to be added to his moral: That, when the ants and the grasshoppers are distributed across the division separating surplus from deficit nations within a badly designed monetary union, the stage is set for a depression that sets all against all in a vicious spiral from which only losers can emerge. A stage from which no one can be bailed out (even those who, like Germany, can bail out themselves, by leaving the eurozone, will be committing a form of slowburning, long run, suicide.

Our only option: To subvert the dominant narrative. Recognising the co-existence of neglected ants and over-pumpered grasshoppers throughout the eurozone is a good beginning.

You are absolutely right in distributing ants and grasshoppers “horizontaly” across Europe and this point of view, which invests in the similarities rather than in the differences between the European countries, makes your general approach a rather optimistic one for Europe’s future. But nevertheless there is the danger of overlooking some important “vertical” differentiations between Europeans in terms of their deeper cultural traits. For instance, may be it sounds odd, but German ants just want to be ants. Most of them prefer to see the Greeks adopting a tight fiscal culture than to see themselves (i.e. the German ants) taking higher wages. The main psychological and cultural objective here is “Sparen” (money saving), not necessarily taking higher wages and living better in mediterranean terms…

To genauer,
Euro was onetime $1.6, I think that it now is around $1.3. So it really went down and that benefitted export oriented Germany.
You really explained the problem that Greece has with the example of unification. You didn’t have to feed 25% people. These people were more or less feeding themselves before. The unification caused that their industry could not compete with the industry of former West Germany. So you helped. Sure both sides were complaining mightily, but it was the right thing to do. In case of Greece, it was worse that the East Germany industrially speaking. When we became one big European family, the Germans being more developed and larger than Greece devastated the Greek industry because they were much better. The Greeks got some help to build the roads so the Germans could drive without fear of destroying their cars and even some other help, but Greeks needed investment in the form what East Germans got.
It is not easy to build an industry to compete with Germany. This is a fact of present reality. In many countries with common currency the stronger parts help the weaker parts. If you will look to Canada the so called have provinces subsidize the have not provinces for decades. Can the Greeks compete with Germans? Yes they can. The Koreans showed it to Japanese. Will they? I don’t know.
Can the debt be paid by Greeks? Yes it can.
There is a moral dilemma. The Greek debt is mostly government debt. The Germans and other smart foreigners were able to bribe too many Greek officials to buy too many things that Greeks don’t need.
The German, the French and other banks knew exactly the ability of how much the Greek government could pay. Why than were extending loans that could be not paid by ordinary means?

The problem is not that Greeks are grasshoppers. The problem is they are monetarily non-sovereign, and such nations require money coming in from outside their borders. They must have a positive balance of trade, as Germany has.

If Germany ever begins to import more than it exports, suddenly and magically, it will become a grasshopper.

There are two, and only two, long-term solutions for euro nations:

1. Return to Monetary Sovereignty by re-adopting their sovereign currencies
or
2. The EU to give (not lend) euros to member nations as needed.

Thank you for your words of wisdom.
“ …because history learned us that we, human beings, have a narrow mind. that we are small and miserable, not capable to overview or understand the deepness of Life.”

@demetre and all,
The Euro is with last years 1.4 not “down”, in fact it is overvalued against “fair value” somewhere around 1.22 -1.25 $. Thats why you and other southern countries have difficulties to export.

How high is the maximum tax rate in Greece now ?

After reunification, Germany had suddenly to feed 25 % more people, and the answer was: raise taxes on everybody, up to 62%.

@robin hood of industrious ants
Your Robert Fisk was found to be so generous with the facts
that there was even a word coined for him: “fisking”,
when people debunked his fairy tales item by item.

@yanis
If you would look at the data, you would find, that the German Capital Account only turned significantly positive in 2004, when the real estate / debt bubble was well on its way in nearly all western countries, except Germany. And until then it was the interest rate policy of the FED, cutting rates down to 1 %, making it impossible for the ECB to keep rates higher than 2%, which was forced on the EU. Do you remember when the Euro stood at 0.83 $, at the start of the Euro 2002 ? making imports like oil very expensive.

Your comment really captured my attention, even though my understanding of economics is indeed very poor.

Yet, with all due respect, I modestly believe that it’ s surely great to be “exact” (genau in english) or convey an accurate argument, but being thorough and complete is of far more greater importance.

So, do you really suggest that the data doesn’t really go as following (with the euro-problem located in that the first two charts reflect theirselves in the third)?

I would like to tell you that I’m a father of two kids, with an accomodation loan on my back and having already lost more than half of my annual income, I’m threatened that I may lose my job within 2012.
You seem to have thought a lot about life, so do not forget that both thinking and life, need a full belly.
I know Greeces’ political history and I’m very well aware of the factors that brought us in this mess. I do not look for the guilty elite. I also do not expect the next elite to be better. But I know which elite is better than another.
My problem with the elite you prefer, is that it points the finger on me on behalf of the Greek Nation AND AT THE SAME TIME THEIR SALARIES (apart from the wealth they gained as corrupted politicians), ARE STILL UNTOUCHED.

This is a real problem dear madam. When the general denies to take the enemys’ bullets, is usually fired by his own men.

Thank you for your sincere answer, and yes, it is so true, a full belly makes the mind thinking different.

I want to add here something personal, that can help to bring in another view on me: I had to delete all my luxury already many years ago, I live very common and sober, and from what I have “left” I support people.
I realize that I live in wealth because I live in the midddle of Nature, in a small common mountain village, in Peace, but simple, pure.
It is warm in the house. Outside it is very cold, but healthy.
I am grateful, every day, for this.

I do what I can to support Greece, and I am in an active contact with Xenia Papastavrou (she founded the Greek Food Bank in Attica, is searching for creating more food banks in Greece), for creating a world wide campaign for http://www.boroume.gr by creating a video about it. I have in all my channels in total over 1800 subscribers and will ask them to send the video to their friends and subscribers.

I search for a similar organization in Greece for another campaign: to collect clothes and shoes, worldwide, to be sent to Greece.

Greece and its people are in my heart, and that is not just a sentence, it is a strong connection.
It goes too far to mention more details.

As soon Xenia has all the official numbers for banking transitions to send money to Greece, for Boroume, I will let you know, here.
You can find it also here, when ready:http://www.youtube.com/FondOfGreek

I send you my warmest greetings, and wish you and your family strength, courage, light.

Of course it is good to gather clothes and shoes as well as food: outside the large supermarkets are repositories where people could leave food for the needy, to be administered by the church which is already having soup kitchens and feeding people.

You have to realized though that the problem of food and clothes is mainly for that 1 million economic immigrants who came to Greece as if it were a land of plenty, or trying to get through to the rest of Europe and now with the lack of jobs are left destitute and are shunned by the locals ( give jobs to the locals is a slogan), particularly if their color makes them easy to discriminate against.

The real problem is that during the last thirty or so years most of greek families crossed the threshold into middle class, getting higher education and aiming for the civil service jobs, which in retrospect we see was all due to the borrowing of the cicada politicians ( cicada because they just sang and were merry while the sun shone). While the sun shone there were a lot of jobs in the private sector too, which have disappeared with the closing of businesses and the shrinking of the private sector.

The result of the crisis is that there is practically a 40% unemployment in the young of these middle class families. Each family I know have one two or sometimes three below 50 years old unemployed, with children and family all depending on the pension of the elderly parents which pensions are being cut by 30 and 40%, while a property tax also diminishes the family income further, punishing the parents because they are supporting their children.

My daughter, with a certificate of long time unemployment ( and the dole stops after the first year) was told that since she was the owner of an apartment in Athens she would be taxed as if she had 7000 euros income in 2010 !, 170euros, which of course will be payed by the parents. On her saying that she was being supported by her parents, the tax lady said: they should make a taxable money gift then to you!

We have reached the stage where the one enduring asset of the greek family, solidarity in adversity, is taxable! The tax collection is eating up any small reserves of the elders of middle class families ( money for teeth work, or their funeral) and god only knows what will happen next year when these are gone.

This situation cannot be assuaged by gathering food and clothing. It is jobs that are needed for the middle class, and the only solution seems to be extensive emigration.

I try to get the complete view on the situation in Greece, but there are so many details that it is impossible. I don’t live in Greece.
It is also impossible to help in the most constructive way, for not only now, but also for the long-term. The situation is so incredibly complex that it is not a question how to solve the entire web of problems, but how to start with that what is the most important NOW.

I don’t know what you can/could do.

Life can be hard, without any pity. Making us suffering, in all kinds of ways.
We, humans, don’t understand that, and try to blame others. Self-pity does NOT work though. Never. The only way out is: first: accept it. If you do not accept the situation as it is you will just resist, and not getting one creative thought for a solution.

You are in a situation maybe the entire world, all peoples, will get in, and yes, all peoples might face problems in the nearby future you and your daughters are facing now. You might find the solution for many others! We learn from each other!

A train needs time to accelerate. But with a persistent going on it finally goes in a wonderful tempo. That power needs to be awakened within every human being, in the spirit, the soul. Once.

In history people have shown to be able to find solutions. How? Because the human mind is able to work with possibilities. Life is a University.

It is a challenge, a difficult one though, but show your daughters the right spirit, being their parent. This is for their future a highly important memory: how you manage it to go through this. As my mother teached me to live with hardly nothing: we were very poor. Every time has its own problems.

Discipline helps. Courage. Positive thinking. Positive thinking is not easy. Being negative, talking negative in bad times is so much easier!

Being positive, working against the wall of negativity around, it is a hell of a job, but continue with being positive, don’t give up, because it works. It works!! Life showed me that. Not only to me.

There is not more mercy from Life for us, who live now, than there has been for people who had to go through wars and despair elsewhere. Life is Energy and wants us to confirm that power from within our Self.

I do what I can do.
Food is a base for living. Clothes and shoes also.
So, that is where I start(ed).

‎….interesting marxist version of the latest “crisis” with touches of eloquent pseudo-argumentation. Still, totally ignoring and and coyly obfuscating the lethal connivance of the state with the banksters in creating “bubbles” everywhere in conjunction with the poisonous fiat money presses….
…my fiat kudos!

To Ilias True.
I totally aggree with you, but the point here is rather simple. We don’t have time any more. If you take mr Lapavitsas’ “out of euro” way, the question is where to find the political elite that will reform Greece. The hard decision here is to choose between our elite (out of Euro and deny to pay the debt) and the european pressure to reform (foollowing the wrong medicine for the country). It’s a mess……

But at last “η ηθική του μηδενισμού είναι ο ανδρισμός” as Kondylis said. No fear and no hope my friend….

After Papandreou checqmated Europe and Greece with his referendum proposal, all what had been hidden till that time became more and more clear: corruption, lies, cheating, illegal acts, lack of food. Nobody could have brought more and deeper truth by acts as this one. It was and earthquake with worldwide effects.

It was already before the moment of the checqmate that time was in an urge. But even with the guillotine over Greece’s head and over Europe Samaras has done anything to make time to an ennemy for everybody, except himself.
He has humiliated the urgency of the quick solution, and he is still pretending as if there is not anything more important than his being the next prime minister. There are Greeks who see this as “strong leadership” I see it as strong subversive bahaviour against the wellness of the Greeks. Illegal in the circomstances of the moment. It should be forbidden.

Life is a forgotten factor in all discussions.
Life is Intelligence in an Evolutionary way and if all life is bringing is against what we think it is the best solution then even the what I, all who are against him, see as the bad move of Samaras and others is a part of that what Life has in store for everybody, in a positive way.

This does not mean that Samaras can be seen now as the hero.
On the contrary. Life will teach him as well.

Life uses all that what is against progress as a remedy for better times.
If it is meant to be that everything collapses then it will be the Best, because history learned us that we, human beings, have a narrow mind. that we are small and miserable, not capable to overview or understand the deepness of Life.

It needs Awareness. Papandreou had it more than anybody else. Greece did not understand it. Did not see it. Does not see it. Even some members of his own political party have let him down.
Venizelos has “it” also. May Greece cherish the good ones. Respect them.

The Greeks can and the Greeks must..
It looks to me that ottoman sultan Mahmed II is before the gates of the city again. We again as at that time are begging for help that it will never come. Some folks don’t realize that Ms. Merkel was not elected by Greeks to serve Greeks. The job of Ms. Merkel is to maximize the amount of butter for each German and supply a barrel of beer to. The job of Mr. Sarkozy is to supply the biggest pail of cream and a barrel of wine to. Those people don’t suppose to lead Europe, they were not voted to lead Europe. Most of you are very young, but let me tell you that I personally witnessed how the Germans burnt my house, the houses of both my grandparents, yes all the houses, including the church and the school.
Besides, how to you know that the whole thing was not designed to happen this way? The euro is down and the Germans can sell everything that the can produce. In reality they are printing money and at the same time they channel the wrath of the people that can’t make it to hate Greeks because it is against the law to hate Jews.
Sure Greeks can do it. But they have to use their brains, not borrowed brains from other countries. From other countries we study the latest technology and science, but how to organize the country and run it we have to do it ourselves.
As I wrote before we need a national service of 4 hours a week of labor from each citizen to decrease taxes and create value like houses, industrial equipment etc. for our use and for sale, and to prepare every citizen to defend the country. Just scrap the army as it is and we have savings of 5 billion dollars each year. The army just can’t defend Greece, all the Greeks can. Are we all idiots?

I do agree with the idea of grasshopers in both Greece and Germany.
I also believe that the Germans do not get as much as their increased productivity permits.

One could argue,however, that the surplas of the German economy fuels the Public Sector’s services such as the National Health System.The Germans may work more for the same income but they drive on an excellent road network, they do not pay extra for education, as Greeks do, and they have access to above-than-average health services.

Germans have, indeed, TOO much confidence in the State but also the State takes care of the citizens.Germany was the first country to introduce a social security system in the 18th century whereas kids in G.Britain worked in the coalmines without any social protection.

Probably one should analyse the current german mentality taking into account the past of the country. This may explain why the average German believes what he or she is told by the media over the lazy Greeks. The ground is fertile for these oversimplified concepts.

We congratulate you, grasshopper,
when on tops of the trees,
you sing like a king,
after drinking a little dew;
for yours are all those things
which you see in the fields
which the woods nourish.
You are held in honour among mortals,
sweet harbinger of summer.

Dear friend, If you read Yannis’ comments on the top of the page about cicadas, you’ll see that I was not wrong about τζιτζίκια. I thing that you took grasshopers for real ακρίδες but I can justify you….

And let me deliver the punchline because I am not even sure if some of you can read hyperlinks within the proper context:

“First and foremost among the culprits is the odd Merkel-Sarkozy couple that has led the demonising of Greece as the cause of the crisis, all but ensuring that what should have been a relatively small and eminently solvable problem at the margin of the union became a full-blown crisis of confidence in the entire European project.

By failing to resolve the Greek problem at the outset, coupled with their bullying tactics, the Merkozy duo has led the citizens of the EU’s 27 member countries to a place inconceivable in their worst nightmares just 12 months ago. Mr Sarkozy’s rejection of the UK’s request for an opt out of the treaty for the City of London, because financial institutions in general were to blame for the financial crisis, is a worrying sign that he and his allies have learnt nothing as they have stumbled from summit to summit. It would have been a small price to pay for unity.”

You are ever so right. Wasting money on curing poor people constitutes scandalous waste. Think of all the oxygen they will keep concerting into CO2 simply by breathing. The sooner we shut these hospitals the better. It is our moral imperative.

Due to the fact that no one can predict the future , it’s hard to see the most appropriate solution .

There is also the problem of the egg and the chicken .

People are not idiotic . They want to be a european member and they don’t want austerity. What’s the oxymoron in it?

Every intelligent economists can recognize that austerity has a meaning in a low unemployment environment .
Want more tax revenues ? Create more jobs and make tax system more fair . That’s not economical theory , it’s common sense .

There is that idiotic wondering again : who is going to invest in Greece ? “Private funds need special conditions to invest in Greece” . This is absolutely provocative .
Show me a modern capitalistic country that private sector is not heavily funded by public investments.

“But again in Greece , public intervention is not acceptable . Private investment is the only viable way out”. . . .

But then again , Greece has so much debt that can not allocate funds for investment and growth . How can we deal with debt ? Actually we can not ! No country has ever survived such debt . Period .

Obviously , we must deal with debt first . Obviously the solution must be political . With or without Europe .

Oh dear, I think my signature was misunderstood! We are talking politics here not personals.
There is a large number of Greek voters who would be more than enthusiastic if Mr. Varoufakis could accept this modest “wedding” proposal. In other words to commit to a political action.
Although I am afraid the answer will be the same. He is happily “married” to what he does…
Yet I am not discouraged. I can wait. (We do not expect elections in Greece soon)

Strange maybe, but I do not believe that your words were so much far from what they express in a way as they are, in my opinion.
To play around with serious words as “marry” is not right.
Yes, marriage has become a kind of a foolish institution with not so much respect, and with promises,that both are not able to follow up.
Life shows and learns.

To create truthfulness and to stay serious (read respectful) in a time with too much seriousness because of suffering people and mountains of fear, I think it would be better to say the things as they are.
Not joking, pretending or faking, misusing words. Too many do this and it has to be stopped.

Faking is always a lie. In this blog in fact everything, posts and comments, are there to find truth: that what is behind the faking faces and misleading words of politicians.
Bankers.

So, please, say things as they are, always, everywhere, and don’t mislead, or try to mislead, or to pretend that you pretend.
Don’t lie when saying that it is not meant as you said.

I wish you though a Marry Christmas, ehh, a Merry Christmas :)) and a happy marriage with the one and only.

When the analogy is carried to lengths, a grasshopper is a bad stand it for a cicada. A cicada sings all summer long, eating moisture and maybe a bit of leaf juice, while a grasshopper is very destructive to the flora.

Unfortunately, the problem that Greece faces is firstly internal and then European, if the internal social and systemic structure does not change whether you are an Ant a Grasshopper or a Queen Bee has very little consequence to the Greek nation.

The destruction of Modern Greece came about during the 20th century by the highly educated and cultivated elite a minority of, Architects, Civil Engineers, Lawyers, Professors, Politicians, Doctors, Artists, etc, who never thought to expose what was going on, from before even the Second World War, as long as it complimented their personal agendas.

Any committee ever set up to review, assess, and implement any sort of Policy was always filled by the highly educated minority who sadly had nothing to do with either Ants or grasshoppers, just sterilized, selfish, class oriented opinions ( University was always a class status in Greece) and agendas cynically throwing the book at the majority of our illiterate countrymen who looked at them in awe believing in their superiority.
In fact it didn’t even matter whether you were from the “Left” or the “Right” the vast majority of these highly educated geniuses had in the end the same method and the same goals.
Shame on us!

I don’t think you can compete with Danae Stratou….
And a marriage needs more than just a “Wow!” We all, here collected in comments, are in that “Wow!”
Not any reason to “marry” him.
There are other websites for that.

Erm, but there is the problem that highly paid professionals purposfully dodge tax and bribe tax collection officials in Greece? It’s not just that there are ants and grasshoppers in every country but there widely documented differences between the cultures and effectiveness (fear?) of the legal systems between the northern and southern countries.

Of course there are. But the main reason is relative backwardness caused, mainly, by the lack of a solid industrial base in the South. Proof of that is how well southerners adapt to the northern norms when they migrate northwards. The point of the European Union surely was to bring about development to the South, provide lacking sources of demand to the North and, thus, bring about convergence. For that to have happened we needed investment not so much in roads and airports in the South but in small and medium size enterprises that are integrated to Northern production and distribution networks (with the North expanding gradually its domestic spending in the process).

Very good piece! It resonates with my view of the euro ecomomy for many years. I hope you take into account in your proposals for solutions there are many ants who, not falling for the games of the grashoppers, have stored their labour, >10 years of it, in euro’s. And that grashoppers are taking this value as we speak. These ants have lost many years in time as well. These ants had to change plans, like not buying a house to start a family. Do you take this stored value and time into account?

Professor Varoufaki
To turn the Schumpetarian spirit of entrepreneurship into “grasshoppers” and the less productive South, that has to work two bits to get their “kid” TV, into ants, is to falsify the historic course of capitalist generated prosperity in toto, that has been carried on the cerebral and imaginative ‘shoulders’ of dynamic entrepreneurship and innovation. Also, for one to denigrate economically the “grasshoppers” as being slothful and unproductive who in actual fact are creatively active, is to put truth on crutches. Of course there are grasshoppers who make their ‘leaps’ in Dantean infernal profits, but can one condemn all entrepreneurs because of this deviation from the main game?

And as Kimon correctly states, it “is for Greeks in Greece to address these malignancies,” that he highlighted so pellucidly, and I would add, under the new, economically and politically savvy, and strong leadership of Antonis Samaras.

As Greek individuals, we owe a debt of immense gratitude to Antonis Samaras who made us the honor to come down from his heavenly throne and actually validate with his signature the “salvation” of our nation.

I could even vote for him if I wasn’t afraid my lowly vote would ruin his “awesomeness”….

Yanis I will be slightly off topic, but still on the subject of parables. They do indeed have the power to illustrate some matters clearly. I run across one last night, which isvery apropos to the scenario of default and hence “automatic” exit from the euro, that our politicians are touting.
The taxi driver that took me home last night had taken a 140.000 loan from a bank to buy a house, so he left his rented apartment to live in his new house for which he is paying a hefty mortgage.
In the meantime the value of the house has depreciated to say 80.000 Euros and he is unable to make the monthly payment of 800 Euros.
So he goes to the bank and says I will pay you each month, as much as I can save after family expenses, be it 100 Euros or 800.
The bank of course threatened to repossess the house and asked him whether he would like to be homeless.
To which he replied that eventually he might be homeless (but of course he could still rent a much smaller house with the money that he has left to pay the mortgage each month), but he is not leaving the house until the bank goes through all the process of repossessing the house, lawfully evicting him and his family and so on.

For me that was the clearest parable to answer those who claim that a default now would automatically kick us out of the euro. That would be as idiotic as this taxi driver going to the bank, and threatening to leave the house, since he is unable to make the full payment.

I enjoyed the post, being a fan of Aesop and his allegories. I also appreciated the candor in your statement “The problem with attractive allegories is that the latter can be as much of a help as a hindrance”. Such non-mathematical allegories (or, wanna-be transforms) are only good to illustrate an already formed opinion, but not necessarily create new ones. Nevertheless, they still have value in their emotional detachment from pressing problems and their contribution to an alternative objective view.

Now to the point of the potential remedy of the situation. Still preserving the allegory, the truth may not be in a better, more equitable, relationship between the ants and the grasshoppers, even if both have essentially the same origin as ΝΙΚΟΣ ΚΟΥΣΠΑΡΗΣ cleverly suggests. Perhaps there is just too many of both.

An ongoing fundamemental problem in the western world is that the democracy we have is only a facade. Even if a relatively good solution to the crisis on hand is implemented today, it will not last because the grasshopers easily usurp the political systems as they are. The ants need to create a much better democracy.

Ants, real ants, as they live in nature, are the best cooperating, coordinating, united, organized, social creatures, the most hard workers, living peaceful together without any war, helping nature, and filled with a huge energy. Never complaining, never stopping.

Grasshoppers: the word reminds me of a sportsclub, with that name. They were successful! Or?
Grasshoppers, in nature, are killers of green, eating all what is there, not leaving behind a little piece for another hungry one.
Grasshoppers were one of the seven plagues of Egypt.

There is one Grasshopper that has an excellent Curriculum Vitae: the one in the fairytale “Pinocchio”, the wooden, male doll, who lied too much, and who’s nose was growing because of that. The Grasshopper, Pinocchio’s living, always present consciousness, growing awareness, warned him, and transformed him into a good, real, human being.

If one Grasshopper is able to be so wise, then all grasshoppers may watch, listen and learn from this one. To stop all the lies in the world, to stop the growing nose of the leading humans in the Multi National Industries, businessmen and -women, of so many many Greeks, with a huge amount of money on the Suisse bank (such a shame!!), of some Greek politicians like there is Samaras!, other politicians, the “New” (??) Democracy (!??), name them, everywhere in the world, even names in all religions, too many have a long nose, the most are Pinocchios, and let us pray (to stay in the religious atmosphere) that they all meet the Grasshopper. The good one…. :)

A horrible aspect of the situation is the lack of true authority in Greece on these matters. Outside the country and with little knowledge of it, it’s easy enough to resist the crudest essentialist “arguments” such as “all Greeks are lazy/corrupt”. But an account, with authority and legitimacy behind it, of what exactly happened to push Greece’s debt so high, and where this wealth flowed to, is still sadly lacking. And it seems that both ND and PASOK are so complicit in what went wrong that hoping for leadership and boldness from Greek politicians (especially in this crisis situation: a point that Prof Varoufakis repeatedly makes in another context, that the Modest Proposal is _modest_, only aimed at restoring necessary conditions for further debate) is in vain.

So I (for instance) can hear all kinds of themes. A property-bubble. Enrichment of the already well-off Greeks, with assets now outside the country. All kinds of urban myths (or facts?) which are still thriving today in spite of what is actually happening in Greece.

What is lacking is an authoritative, indigenous Greek defence against some of the more ridiculous accusations floating about. Who do we trust to give the _facts_? Well, this blog has my thumbs-up. But we need more than that: Prof Varoufakis is an economist and commentator, and can’t be a spokesman for an inquiry into truth backed by the Greek people, simply because there hasn’t been one. Trust Greek politicians? (When Greeks themselves don’t?) Trust the IMF? No way. The EU? No way – as anyone reading this blog realises, facts about Greece are inevitable politicised by exposure to the Belgian or German (or Cannes…) atmosphere.

This brings in what I found most attractive about the Hreokratia film: the suggestion of an indigenous, Greek (Ecuadorean, in their example) investigation into the debt. Clearly tracing what money came in, where it went, who it benefited. This would assume (and require) great authority. And would surely defeat the “Greeks should get their house in order” meme – what better prelude to this than evaluating the situation coldly and clearly, on your own terms?

But maybe Greek authority, clarity and insight into the horrible situation Greece is in, and its causes, are actually _superfluous_ to the proper progression of the story we’re being told; maybe the meme of “irresponsible Greece” conceals a desperation on the part of those who utter it, a terror that Greece will actually escape this smug diagnosis, start telling its own story, and thus escape – out of control – from the narratives imposed on it from outside?

This is the logic of Hreokratia. What the film doesn’t consider is: Is default from imposed, external, bullshit narratives possible without, additionally, default from the Eurozone?

“massive pressure from banks et al to take loans out in order to provide for their kids that which the TV tells them no kid should be without”. Seriously? So people are pawns who are susceptible to any of sort of pressure especially that which will hurt their well being. This notion that the people are incapable of making any decision of their own and they are not responsible for the choices they make is insulting and plain demagogery. As for the bailouts, you fail to mention that the Greek state ran a 13bn PRIMARY deficit in 2010 which was paid for by those loans. It seems to me that your tale is as simplistic and misleading as the one presented by the “Bild” type northern populists. Disappointing post.

yes exactly that…people fall victims all the time. else things like smokers, drug addicts, star system, fashion, soccer etc etc, would never exist. but they do…! your flaw is that u measure the behavior of a mass of peeps with individual standards. not gonna work.

Excuse me if off-topic: but I have to say that the sudden irruption of Leibniz’s Monadology and George Krimpas’s commentary into the book you co-authored with Halevi and Theocarakis (Modern Political Economics) is shocking and brilliant.

It makes no sense that I can properly express. It is presented with no explicit, familiarising connection to the rest of the book (though of course you do refer to Leibniz outside this irruption). It is a solitary, self-consistent rant – by Leibniz; and in its inclusion in the book, a rant by Krimpas. The tone changes.

But there is consistency. Reflecting on it I can only say (for the moment) that it fits artistically. There is something about the Monadology that captures themes from the whole book; and Krimpas’ commentary (apart from the irruption itself) gives a tone of anger: anger speaking to my anger, was the feeling reading this section. (I never guessed studying Leibniz years ago that he would be so relevant). There is something not quite within my grasp, a connection between the Monadology and the wider themes in the book, that is appealing for more understanding: I’ll have to reflect more on the Newton/Leibniz contrast. And I can’t help thinking – from the form of Leibniz’s writing alone – that quite different, self-consistent rants have existed, with quite different consequences if transferred from metaphysics to practicality: Spinoza, for example!

To conclude, a small “Fun” Fact I only discovered last week, but which I’m sure hasn’t escaped your attention: that the evil NAIRU we in the UK were subjected to in the 80s was the brainchild of, among others… a certain Lucas Papademos. Good Luck Greece.

Congratulations for encouraging this amateur, at least, to try to wrestle with the “can’t quite put my finger on it but it’s WRONG” aspects of Rational Expectations, Efficient Markets et al.

When the greek ant complained to the greek grasshopper : Where did all this produced wealth during summer times go ?
The grasshopper responded : We consumed this wealth all together !

Personally i wouldn’t expect the average european individual to delve into such matters , unless he is dealing with tough reality himself/herself or has an extra sensitivity. The ones still hanging on a job will opt conservatively for things to remain the way they are . They won’t choose change for better .

If a part of greek working people are unable to understand this allegory , are we expecting northern europeans to grasp it ?

European nations are not that different . They are isolated though from one another . They would prefer to exhibit an introvert behavior . I am pessimistic .

I agree that Greece is a sadder version of the story in this narrative, since, as you say, despite what DNA tells us, a lot of ants were grasshopperized and find it hard to go back to anthood in these dire straits. The large influx of immigrant illegal workers after the fall of the iron curtain turned a lot of serfs into aristocrats ready for the good life and tax evasion. All their kids were educated in a boom of “higher education is for all” movement and can they now go back to gathering fruit at small profit (as an example) at their parental farms?

I think your are carried away from your own convictions and experiences . Look into this matter from a macro-economic perspective and you will find out that there was wealth produced in this country the past ten or more years .

Notice that Mr Varoufakis don’t talk about τζιτζίκια but ακρίδες (grasshoppers ) . What grasshoppers do is move from one place to another and in-between they completely drain all the available resources . That’s exactly what modern financiers are doing , whether they are greek or german .

I am not against profit , but draining financial energy from productive processes , and destroying well established financial structures in favor of short term higher profits , is criminality to say the least .

As far as the discrepancies you mention between greek and german mentality . I think you want to believe that .

The sad truth to this story is that these grasshoppers will fight tooth and nail before allowing anyone to subvert this narrative. This is one of the reasons why Europe has not come up with any credible solution even though people all over the world, yourself included, have brought forth reasonable proposals. They would prefer that no real changes are made to the economic landscape, return to the pre-2008 environment and continue enjoying the “easy money.” Grasshoppers go so far as employing highly educated people in finding ways to make the easy money with no concern of the consequences of their actions (ie sub-prime lending). Unfortunately, as long as these people are allowed to do so, which looks like they will since it is they themselves that make the rules, then very little if anything will ever change. I hope I am wrong and that there are good people with enough power working to right this ship but until I see it with my own eyes, I will remain a doubting Thomas.

A very nice tale that illustrates that it is not a matter of geography but a matter of classes. Germany’s working class has as much cause to resist the path we are taking as the Greek working class. Alas, this realization is exactly what the powers that be, with the help of the media, are fighting against. And they have been winning for a long time. The difference, now, is that within the grasshoppers ranks there are opposing forces. Perhaps there is still a chance…

No mention of the closed professions in Greece; no mention of the Greek state’s inability to collect taxes or enforce laws; no mention of the fact that it is easier to start a business in Ethiopia than it is in Greece; no mention of the fact that the Greek economy is dependent on the whims of mafiosi trade unions, their strikes and demonstrations (Greek trade unions, it seems to me, prefer to grandstand and plot revolution rather than enter into meaningful negotiations with employers to protect the interests of supermarket workers and so on); no mention of the fact that elevating students to the status of a mythical revolutionary vanguard has brought ruin to Greek education, and so on and so on – you get my drift.

Not that I’m saying that the crooks who constitute Greece’s capitalist class are any good; they’re not – but then where are the proposals to displace these antediluvian crooks with innovative entrepreneurs? Greeks do realize that the way out of this crisis is by encouraging a new generation of entrepreneurs and by utilising the extraordinary human capital Greece has at its disposal?

So, the point I want to make is that the Greek left – Pasok, KKE and Syriza – are as responsible for bringing Greece to its knees as the external hits the country has taken. To be fair, Professor Varoufakis does often refer to Greek ‘malignancies’ – but what I want, as a Greek from the diaspora, who loves Greece with all my heart, is for Greeks in Greece to address these malignancies; after which, they can complain all they like about the Germans, the Dutch and all the rest.

Of course, Nea Dimokratia is also responsible; but I was arguing against a sanctimonious and hypocritical Greek left, which refuses to take its share of the blame for where Greece is today, as if, for example, the state of Greek public services, the stifling of Greek entrepreneurship, the dire conditions of the Greek education system and the underdeveloped public political discourse, has nothing to do with them. For me, included in the ‘malignancies’ afflicting Greece has to be Syriza and KKE, which exercise disproportionate influence on politics and society relative to their electoral support, and they are not averse to doing this this through violence, intimidation and contempt for the law.

@aerosol: I’ll tell you what’s really funny – or do I mean tragic? – is that your country has gone to the dogs, Greeks are an international laughing stock and all you’re interested in is some Byzantine, theological point about whether Pasok is left-wing or not, on whether the Holy Spirit proceeds from the father and son, or just the father… or whatever.